«Love in Troubled Times»: the need for pre- or post-nuptial agreements

Isabel Winkels is Managing Partner of Winkels Abogados (www.winkelsabogados.com) She is an expert in family law.

«Love in Troubled Times»: the need for pre- or post-nuptial agreements

Isabel Winkels

21 February 2016

I must confess that I have never even watched one episode of the television series mentioned in the title of this article, nor of its sequel «Love is Forever». However, from a professional perspective, I have indeed witnessed the radical change of families as a result of globalisation, and the increased labour and personal mobility that provoke changes that were not anticipated when these families were formed.

These changes have impacts on all couples, as they usually involve better jobs and higher wages for one of the partners, but they can also entail a loss of professional expectations for the other.

It is a well-known fact that life is erratic and unpredictable.

A women came to the firm this week who had been an executive at a major company and who, after following her husband’s professional ventures around different countries for 12 years, had renounced her professional aspirations. In spite of having had to leave her job in Spain to travel with him, at some points along the way she engaged in minimum professional activity, with substandard earnings, and as a result, the courts had denied her both the recognition of spousal maintenance and entitlement to compensatory support set out in the Civil Code for couples married under the separation of property regime –which was her case–, in which the wife has devoted her time to looking after the household.

Unjust, unjust, unjust, she chanted: What was she going to do now, at 50 years old, and more than 12 years outside the employment net?!, and what would she do when she retires?! how much would her retirement pension amount to?!

Jobs like the one she had before are few and far between now.

These situations are not uncommon: the case where one of the partners sacrifices their professional career for the family –even though they do not leave national territory–, while the other partner thrives freely in their job. This dynamic can lead to unfair situations like the one described above, as engaging in any professional activity, albeit minimal, albeit part-time, hinders the recognition of spousal maintenance or compensatory support to alleviate the imbalance; unless the conditions of this waiver and the appropriate support for each situation are clearly agreed upon.

The Spanish Civil Code dates back to 1889, although logically, legislators have been amending many articles over the course of the last century.

Art. 1.6 makes explicit reference to, as one of the sources of the law, the doctrine that establishes the Supreme Court through its case law; meanwhile art. 3a also authorises the rules regarding the social context in which they must be applied.

It is precisely this social context that is leading the Supreme Court to issue judgements upon which jurisprudential doctrine is established on such burning issues such as shared custody, residence, and family relationships in general.

Along these lines, despite the lack of tradition of pre- or post-nuptial agreements, in its judgement of 26 June 2015, the Supreme Court raised the issue of whether or not the agreement whereby only the husband is obliged to compensate the wife with a life-long income in the event of separation or divorce is compatible with the law, regardless of whether there had been an imbalance in terms of assets.

This judgement will be assessed using the following case.

The source of conflict lies in the contentious claim for marital separation filed by the legal representation of Ms. María Pilar against Mr. Manuel.

The Court was urged to give a judgement, upholding the claim and ruling, among other measures, that Mr. Manuel had to pay Ms. Maria Pilar the monthly sum of 1,412.21 euros for life from the moment the claim was filed.

Manuel contested the claim in opposition of its content, requesting the court to, among other rulings, declare null and void one of the sections of the notarial deed on which is the claim is based.

The Court of First Instance ruled in favour of Mr. Manuel with regard to the point that is of interest to us, denying recognition of support.

The legal representation of Ms. Maria Pilar appealed before the Provincial Court of Cadiz, which revoked this point and deemed admissible the claim for a life-long pension.

An appeal for reversal was filed before the Civil Chamber of the Supreme Court, and on the sole grounds of «the evident record of contradictory case law of Provincial Courts regarding the problem raised, without the presence of Supreme Court case law on the same issue».

JUDGEMENT FROM THE SUPREME COURT

The following factual background was taken into account: Ms. Maria Pilar, doctor, and Mr. Manuel, lawyer, married in Sanlúcar de Barrameda in 2003 under the regime of complete separation of property by means of public deed.

Before the same notary public and at the time of concluding a marriage contract, the spouses agreed that, in the event the relationship deteriorates, resulting in marital separation, Mr. Manuel undertook to pay Ms. María Pilar a monthly pension for life of 1,200 euros (updated annually based on the application of CPI).

The year after, Mr. Manuel declared before a notary that he wanted the annual update of the CPI to be calculated from the moment they got married. Furthermore, for a short period of temporary disruption to conjugal living, Mr. Manuel paid Ms. María Pilar these amounts, thereby complying with the previous agreement.

However, the permanent marriage breakup took place in 2010, the claim for which led to this judgement.

The judgement of the Court of First Instance considered that the pre-nuptial agreement between the parties breached the principle of equality, thus declared it null and void. The Court stated that the agreements limited the right to marital separation and placed one spouse in a more unequal position that the other, thereby breaching art. 1328 of the Civil Code.

In contrast, the Provincial Court, on revoking this point of the judgement, believed there to be no flaws in the consent, given that it was an exercise of free disposal of assets that by no means influenced spousal equality and thus, provided no grounds to believe the husband was in a position of weakness.

The Supreme Court, in upholding the judgement of the Provincial Court, points out that we are not faced with a regulatory agreement, and that these types of agreements are non-standard agreements (known as marriage contracts).

These contracts, pursuant to art. 1325 of the Civil Code «do not only affect the matrimonial property regime but also, with a more flexible approach, any other provisions on the grounds thereof».

Thus, the Supreme Court favours these types of agreements, given that, in accordance with the express wording of the relevant judgement, «society demands a less restrictive system with a greater margin for autonomy within family law in harmony with thefree agreements between spouses».

In addition, these agreements are not contrary to the law, morality or public order, given that they are only limited to establishing a financial agreement in the event of spousal separation.

Consequently, the Supreme Court dismisses the appeal for reversal filed by the legal representation of Mr. Manuel, stating that the equality of the spouses is not questioned, and neither partner has abused a position of power or been forced into submission by the other.

We can consider that the Supreme Court’s clear stance on the validity of pre- or post-nuptial agreements, together with the ever-increasing complexity of family relationships, and the unforeseeable nature of their evolution, render the execution of these types of agreements essential, either prior to marriage or when a vitally important change is confronted, such as the one faced by the women mentioned at the start of this article. If she had signed an agreement before leaving her job and following her husband half way around the world, whereby she was guaranteed suitable support and an adequate retirement pension, she would not be forced to contend with a distressing and uncertain future like the one she is facing now.